United States of America v. LaPant et al

Filing 50

ORDER signed by District Judge Kimberly J. Mueller on 6/22/17 ORDERING that the court confirms a stay will not be imposed and DENIES defendants' motion to stay. This order resolves ECF Nos. 37 and 38 . (Becknal, R)

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1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 FOR THE EASTERN DISTRICT OF CALIFORNIA 10 11 UNITED STATES, 12 Plaintiff, 13 14 No. 2:16-cv-01498-KJM-DB v. ORDER ROGER J. LAPANT, JR., et al., 15 Defendants. 16 17 This case is before the court on the motions to stay proceedings brought by 18 19 defendants Roger J. LaPant and Goose Pond AG, Inc. LaPant Mot., ECF No. 35; Goose Pond 20 Motion, ECF No. 37. Plaintiff United States opposes both motions. Opp’n, ECF No. 39. At 21 hearing on defendants’ motions, Kimberly Almazan and Zachary Colbeth appeared for LaPant, 22 Robert Soran and Ashley Boulton for Goose Pond, and Gregory Broderick and John Do for the 23 United States. ECF No. 42. For reasons explained below, defendants’ motions are DENIED. 24 I. 25 BACKGROUND AND PROCEDURAL HISTORY The United States filed a complaint against defendants on June 30, 2016, alleging 26 they discharged pollutants into the “waters of the United States” without authorization in 27 violation of § 301 of the Clean Water Act (CWA), 33 U.S.C. § 1311(a). Compl. ¶ 1, ECF No. 1. 28 The United States seeks injunctive relief and civil penalties. Id. ¶ 2. On May 2, 2017, defendants 1 1 filed a motion to stay this case, pending the resolution of the Ninth Circuit case denominated 2 United States v. Robertson, No. 16-30178 (9th Cir. filed Aug. 1, 2016). Defendants anticipate 3 Robertson will decide whether a prior Ninth Circuit case, United States v. Davis, 825 F.3d 1014, 4 1020 (9th Cir. 2016), has had the effect of overturning N. Cal. River Watch v. City of Healdsburg, 5 496 F.3d 993, 999 (9th Cir. 2007), which held that Justice Kennedy’s concurrence in the case of 6 Rapanos v. United States¸547 U.S. 715, 767 (2006), provides the test for determining jurisdiction 7 under the CWA. The United States opposes defendants’ motion. Opp’n. Defendants have 8 replied. LaPant Reply, ECF No. 40; Goose Pond Reply, ECF No. 41. 9 II. 10 11 DISCUSSION A. Legal Standards A district court has inherent power to control the disposition of the cases on its 12 docket in a manner to promote economy of time and effort for itself, for counsel and for litigants. 13 CMAX, Inc. v. Hall, 300 F.2d 265, 268 (9th Cir. 1962). The trial court may, “with propriety, find 14 it is efficient for its own docket and the fairest course for the parties to enter a stay of an action 15 before it, pending resolution of independent proceedings that bear upon the case.” Leyva v. 16 Certified Grocers of Cal., Ltd., 593 F.2d 857, 863–64 (9th Cir. 1979). This rule applies whether 17 the separate proceedings are “judicial, administrative, or arbitral in character, and does not require 18 that the issues in such proceedings are necessarily controlling of the action before the court.” Id. 19 The court’s inherent power is discretionary. CMAX, 300 F.2d at 268 (9th Cir. 20 1962). In determining whether a stay is warranted, the court must weigh the competing interests 21 resulting from granting or declining a motion to stay. Id. Among the competing interests are 22 (1) the possible damage that may result from the granting of a stay, (2) the hardship or inequity a 23 party may suffer in being required to go forward, and (3) the orderly course of justice measured in 24 terms of the simplifying or complicating of issues, proof, and questions of law expected to result 25 from a stay. Id. at 268; Lockyer v. Mirant Corp., 398 F.3d 1098, 1110 (9th Cir. 2005). Finally, 26 “[t]he party requesting a stay bears the burden of showing that the circumstances justify an 27 exercise of that discretion.” Nken v. Holder, 556 U.S. 418, 433–34 (2009) (citing Clinton v. 28 2 1 Jones, 520 U.S. 681, 708 (1997); Landis v. N. Am. Co., 299 U.S. 248, 255 (1936)). The court 2 weighs the competing interests in this case below. 3 B. 4 Analysis First, the court must balance the “possible damage [to plaintiff] which may result 5 from the granting of a stay,” with “the hardship or inequity which [defendants] may suffer in 6 being required to go forward.” CMAX, 300 F.2d at 268. If there is “even a fair possibility that 7 the stay for which [defendants] prays will work damage to someone else,” then defendants must 8 show “a clear case of hardship or inequity in being required to go forward.” Landis, 299 U.S. at 9 255. 10 The court must also consider “the orderly course of justice measured in terms of 11 the simplifying or complicating of issues, proof, and questions of law which could be expected to 12 result from a stay.” CMAX, 300 F.2d at 268. In reviewing this factor, the court is mindful of the 13 imperative that the Federal Rules of Civil Procedure be “construed, administered, and employed 14 by the court and the parties to secure the just, speedy, and inexpensive determination of every 15 action and proceeding.” Fed. R. Civ. P. 1; see also Landis, 299 U.S. at 254–55, 57 (a court has 16 the inherent power “to control the disposition of the causes on its docket with economy of time 17 and effort for itself, for counsel, and for litigants” and “[h]ow this can best be done calls for the 18 exercise of judgment, which must weigh competing interests and maintain an even balance”). 19 Here, defendants contend a stay is warranted because Robertson is expected to be 20 heard by the Ninth Circuit in the next four to six months. Goose Mot. at 13; LaPant Mot. at 10. 21 Defendants also contend, should the case proceed, they will face unnecessary expenditures due to 22 ongoing discovery. Goose Mot. at 12; LaPant Mot. at 12. Plaintiff counters that a decision in 23 Robertson may not issue for more than 14 months, and ongoing litigation costs are not a reason to 24 justify a stay. Opp’n at 9. 25 The court finds the first two factors weigh against staying this action. Defendants’ 26 contentions do not warrant a stay. First, although oral argument is set in the Circuit for August 27 29, see Robertson, Dkt. No. 57, it is unclear when the Circuit will resolve Robertson. Second, as 28 to ongoing litigation costs, the Ninth Circuit has said “being required to defend suit, without 3 1 more, does not constitute a clear case of hardship or inequity within the meaning of Landis.” 2 Lockyer, 398 F.3d at 1112. Third, at hearing, the United States contended ongoing and future 3 harm would occur should the case be stayed, and delay will thwart its efforts to obtain the right to 4 mitigate onsite damage to the property. This factor on balance weighs against a stay.  See id. 5 (“[U]nlike the plaintiffs in CMAX and Leyva, who sought only damages for past harm, the 6 Attorney General seeks injunctive relief against ongoing and future harm.”). 7 As to the orderly course of justice, the court concludes this factor also weighs 8 against a stay. Defendants contend a decision in Robertson would clarify issues of CWA 9 jurisdiction, which remain in doubt given the pending appeal. LaPant Mot. at 13; Goose Pond 10 Mot. at 11. However, when pressed at hearing about the precise effect Robertson would have on 11 the defendants’ discovery budget or efforts, or how exactly the Ninth Circuit’s decision might 12 narrow defendants’ liability, defendants made only generalized and unsupported assertions. 13 Goose Pond’s counsel did say the primary impact would be felt during expert discovery, the 14 parameters of which could change significantly if Robertson is decided as defendants hope. At 15 hearing the court indicated it would not impose a stay but would entertain a modified schedule for 16 expert discovery and trial, to provide more time to assess the potential effects of Robertson; since 17 hearing the parties have met and conferred to propose an amended schedule. They now agree to 18 complete discovery by July 2018 and to have the case ready for trial by May 2019. See 19 ECF No. 46. The court approves of this new schedule, which will facilitate the “orderly course of 20 justice” without the entry of a stay. See Leyva, 593 F.2d at 863–64. 21 III. 22 23 CONCLUSION On balance, after weighing the competing interests, the court confirms a stay will not be imposed and DENIES defendants’ motion to stay. 24 This order resolves ECF Nos. 37 and 38. 25 IT IS SO ORDERED. 26 27 DATED: June 22, 2017. UNITED STATES DISTRICT JUDGE 28 4

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